Multi-speed Europe threatens CEE unity - Polish presidential adviser

WARSAW, May 25 (Reuters) - Efforts by some western governments to foster closer ties within the European Union could undermine the unity of central Europe, weakening the region’s clout within the bloc, a senior adviser to the Polish president has said.

Krzysztof Szczerski’s comments add to a chorus of concerns in the EU’s east over the idea of “multi-speed” Europe, which is earning growing support in Germany, France and other EU countries since Britain voted to leave the bloc.

“We cannot allow for a scenario where the evolution of the European Union towards a multi-speed Europe hits the unity of central and eastern Europe,” Szczerski, President Andrzej Duda’s adviser, told the Reuters Central & Eastern Europe Investment Summit.

Since coming into power in 2015, Poland’s ruling conservatives, together with Hungary’s nationalist-minded Prime Minister Viktor Orban, have hoped to rally support among neighbors for a push to erode the power of Brussels institutions.

The Czech Republic and Slovakia are considerably less enthusiastic in their overall euro-scepticism than either Warsaw or Budapest. Still, Prague has said there should be no splitting of Europe into two groups of countries with different integration levels.

Szczerski said that if being in Europe’s top speed group were to require simultaneous membership of the Schengen area, the euro zone and participation in talks on the bloc’s new security policy, only Slovakia and Slovenia would fulfill all the criteria.

Romania, Bulgaria, Croatia, Poland, the Czech Republic and Hungary, as well as the Baltic States, for various reasons, would be left out, Szczerski said.

“Therefore, we are working to strengthen our regional community to build a too big to fail force here, so that the region’s potential is so great that it cannot just be shredded in the shredder of a multi-speed Europe,” he said.

EURO ZONE REFORM

Poland is in no hurry to adopt the euro, with Szczerski saying that the flexibility of national exchange rates allows for a greater control of economic development. According to different polls, more than two-thirds of Poles oppose joining the euro area.

While Poland wants the euro zone, its largest exports market, to be stable, reforms in the currency union should not lead to higher entry costs for future members, Szczerski said.

“Secondly, the reforms cannot lead to political pressure to make decisions that are not in line with economic interests, for example, by creating a separate budget for the euro area at the expense of non-member states,” he added.

Newly elected French President Emmanuel Macron’s enthusiasm for a common euro zone budget and finance ministry - although, crucially, viewed with scepticism in Berlin - has also raised fears among eastern countries that they could lose out on EU funds.

Poland is the largest beneficiary of EU funds and is due to receive 77.6 billion euros ($84.4 billion) in the current 2014-20 budgetary period for infrastructure projects, its poorer regions and improving the competitiveness of its economy.

“We will keep a careful track of developments (in the euro zone),” Szczerski said. “I think a meeting at the highest level (between Poland, Germany and France) would be a good opportunity to talk about it openly.”